General Assembly President calls for international response to financial crisis

30 October 2008

The international community must fundamentally reform the global financial system and help restore the trust lost as a result of the greed and corruption that caused the current economic crisis and untold suffering around the world, the President of the General Assembly stressed today.

General Assembly President Miguel D’Escoto was speaking at the inauguration of a high-level task force – chaired by Joseph Stiglitz, winner of the Nobel Prize for Economics in 2001 – to review the global financial system.

“The international community has the responsibility and the opportunity to identify longer-term measures that go beyond protection of banks, stabilization of credit markets and reassurances for big investors,” said Mr. D’Escoto.

“The stakes are too high for half-measures and quick fixes put together behind closed doors,” he added.

The President noted that the global financial system does not reflect the global and interdependent nature of the world’s economies and told United Nations Member States that a solution to the crisis must involve all countries in a democratic process.

“We must take advantage of the unique forum provided by the United Nations to build agreement on the new financial architecture required by the international community,” said Mr. D’Escoto.

The response to the current turmoil affecting world markets must also take into account the poor, said Mr. D’Escoto while reminding Member States to meet their commitments to finance development despite the crisis.

“Sacrifices should be shared and cannot be placed on the backs of the poor as is usually the case,” he said.

“All nations must be subject to financial discipline, including the rich and powerful, or there will be no effective international regulations.”

Mr. D’Escoto called for Member States to “get down to business” and identify actions that can lead to genuine change so that the world economy can recover from the current crisis.

“The only realistic way to proceed from now on in our world is to proceed democratically in an inclusive manner and there is no better place to do that than here in the General Assembly,” he later told journalists at a press briefing at UN Headquarters in New York.

The General Assembly President has put together a panel of experts to review the global financial system, including major bodies such as the World Bank and the International Monetary Fund (IMF), and to guide the world body in its deliberations concerning its response to the financial meltdown.

The group is headed by Dr. Stiglitz of Columbia University, and includes Prabhat Patnaik from the Center for Economic Studies and Planning at Jawaharlal Nehru University and Sakiko Fukuda-Parr of the New School University, who all addressed the General Assembly in the morning session.

“The problem today in the financial markets is a lack of credibility, and part of the problem of the lack of credibility is a lack of legitimacy of the international financial institutions because they don’t have governing structures that correspond to the 21st century,” Dr. Stiglitz told reporters.

Pedro Páez, Minister of Economic Policy and Coordination of Ecuador, Calestous Juma of the Kennedy School of Government at Harvard University and Francois Houtart, Chief Editor of Social Campus, were this afternoon’s panellists.

In his closing statement to the panel, Mr. D’Escoto said he was heartened by the “enthusiastic and constructive participation of Member States” in the event and their support for using the General Assembly and the UN as a forum to deal with the financial crisis.

“In the weeks and months ahead, we must stay engaged in the search for solutions that transcend narrowly defined national interests. We must ensure that the changes that are decided on truly serve the good of all our peoples [and] nations, as well as our fragile planet.”

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General Assembly President sets up task force to review global financial system

The President of the General Assembly has announced he is setting up a high-level task force to review the global financial system, including major bodies such as the World Bank and the International Monetary Fund (IMF), in response to the current turmoil that is affecting all countries, large and small.